1 Market Feasibility Study Real-Time Brain Monitoring System.
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Transcript of 1 Market Feasibility Study Real-Time Brain Monitoring System.
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Market Feasibility StudyReal-Time Brain Monitoring System
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Introduction
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Brief Summary
• Market feasibility study• Office of Technology Licensing
offerings• Benefits based on available market• Weighed philanthropic benefits • Based final decision on financial
merits
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Assumptions
• Assumptions:– Add-on Versus Stand-alone Solution – U.S. Market Only– Initial Market Demand Based Only on
Neonatal Intensive Care Units• Follow-On Markets Exist (e.g., PICU,
Operating Room, Recovery Rooms)
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The Problem
• Current monitoring devices and methods are limited– Providing qualitative assessments– Predicting seizure events is difficult– Analyzing events results is lengthy
• Video
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From the Inventor…
Care of University of Florida Hospital Systems: mms://wm8.video.ufl.edu/onc/051705Carney386.wmv
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The Solution
Real-Time Brain Monitoring System• Algorithms based on multivariate data
input• Uses all available patient data• Alerts when activity varies from the
expected norm• Intervention/fidelity of analysis
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Patient
Signal Acquisition Equipment
Wireless MonitoringIllness Index and Detection Alarm
Technical Depiction
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Market Analysis
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Market Analysis
• Medical Devices– $125.9B in 2004 sales– Future demand at 4.1% compounded
annual rate to $167.4B by 2010
• Electromedical Equipment– $19.7B in 2004 sales, 8.7% growth rate– Growth rate of 7.7% annually until 2009
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Market Analysis
• Neonatal Intensive Care Units– 4.1M births annually– 1 in 8 births classified as premature– Premature infants at 30% greater risk of
major medical issues– Impact $26.2B annually, $51K per infant– >20,000 NICU beds
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Entry Barriers
• Food and Drug Administration– Class II Device– Pre-market Notification required (510K)– Needs to be Substantially Equivalent
• Market Acceptance
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Competition
• Other patented devices• Brain Z• Infra-Red Perfusion and Brain
Imaging Technology
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Demand Analysis
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Demand
• Product demand is dependent on service demand
• Service demand is based occupancy of NICU beds by preterm infant seizure patients
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Demand
• Historical data suggest;– > 20,000 NICU beds in the U.S.– ≈ 78.5% occupancy rate– 11.1% preterm infants have seizures– Demand ≈ 1,750 units– Significant uncertainty in data
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Demand Estimate
• Population• Birth rate (14.14/1,000)• Preterm births (12.5%)• Preterm infants with seizures (11.1%)• Average NICU stay (17.5 days)
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Demand Analysis
2007 2008 2009 2010
U.S. Population 291,263,000 293,672,000 296,081,000 298,490,000
Total Number of Births
4,118,459 4,152,522 4,186,585 4,220,649
Preterm Births 514,807 519,065 523,323 527,581
Preterm Births with Seizures
5,7144 57,616 58,089 58,561
Number of NICU Beds Requiring
RTBMS2,740 2,762 2,785 2,808
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Demand Summary
• Initial demand ≈ 2,740 units• Demand increases ≈ 0.8% per year
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Financial Analysis
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Assumptions
• The Financial Analysis includes the following assumptions:– US market only– One scenario – one company to take product
from development phase to market– Market share over ten years 41%– Government funding– Price per unit $12,500– Units sold– Revenue growth is 8.7% per year
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Research & Development
• R&D costs total $11.6M and are incurred mainly during the period 2006 to 2008
• Costs include:– Software development costs of $2.0M– Research costs involving the validation and
integration of the EEG measures of $1.9M– Marketing and Planning during the
development phase of $1.3M– Clinical testing of $1.7M– Other costs of $4.7M
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Profit & Loss Statement
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Break-Even Analysis
Break-Even Analysis
(15,000,000)
(10,000,000)
(5,000,000)
0
5,000,000
10,000,000
15,000,000
20,000,000
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Year
Am
ount
($)
Sales Revenue COGS and Operating Exps. Net Income/(Loss) Cumulative profit/(loss)
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Financial Indicators
Return on Investment (ROI) – 5th Year -$921%– 10th Year -$1,286%
Internal Rate of Return (IRR)– 10th Year -121%
Net Present Value (NPV)– 5th Year -$73M– 10th Year -$89M
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Conclusions and Recommendations
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Conclusions
• The RTBMS offers a tangible solution– Doctors and medical staff are not able to
predict the onset of neonatal seizures.• The technology can reduce seizure
associated financial burdens– Parents of patients (costs of care)– Hospital community (lawsuits)
• The philanthropic nature of the RTBMS is not enough to warrant the technology’s being taken to market. – Limited market demand for the technology – Protracted payback (break-even) period
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Recommendations
• We recommend no investment in the University of Florida’s Real-Time Brain Monitoring System– Large financial risks based solely on the
investment in the technology– Cumulative losses of $4.9 million over a
14 year period
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Questions and Answers
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Thank You!